By Kevin E. Noonan --
Earlier today, Patent Docs participated in a conference call with Jim Greenwood (at right), the President and CEO of the Biotechnology Industry Organization (BIO). Mr. Greenwood, who represented Pennsylvania's Eighth District in the U.S. House of Representatives from January 1993 through January 2005 prior to his BIO appointment, had invited the press and a handful of biotech and pharma bloggers to participate in the conference call, where he provided a briefing on the prospects for passage of biologics legislation and patent reform legislation in this Congress. Mr. Greenwood expressed the hope, in view of the time and effort expended in "educating" legislators to the intricacies of these issues, that progress can be made with respect to both pieces of legislation in order to avoid starting over were the legislation left to the next Congress and administration.
The costs of these additional efforts are not worth passage of pending legislation, however, especially with regard to the patent "reform" bill under consideration by the Senate. Indeed, BIO's position on the Senate patent reform bill is that "no bill is better than this bill," and Mr. Greenwood vowed that BIO would continue to vigorously oppose the pending bill and to work to prevent cloture of debate and a vote, something Senators Leahy (D-VT) and Hatch (R-UT) have promised to do in this session.
BIO agrees with several portions of the bill, including the venue provisions and establishment of some form of post-grant review along the lines of European oppositions which must be filed within nine months of patent grant. However, it opposes unlimited opportunities to challenge patents (the so-called "second window") for oppositions; citing an economic analysis by Robert J. Shapiro and Aparna Mathur (see "The Economic Implications of Patent Reform: The Deficiencies and Costs of Proposals Regarding the Apportionment of Damages, Post-Grant Opposition, and Inequitable Conduct"), permitting an unlimited opposition period would increase the costs of the system 100-fold, to 1.6 billion dollars a year. BIO also believes the inequitable conduct provisions of the bill are "nonsensical." Of particular concern are the apportionment of damages provisions, which BIO argues would encourage patent infringers to consider infringement damages as just another "cost of doing business" and thus devalue patents to the detriment of investment. On this issue, BIO believes the patent reform process was "hijacked" by the information technology and financial industries, which used intensive lobbying and fundraising efforts to encourage the current provisions of the bill. Mr. Greenwood thinks the tide may be turning on this point, however, in view of opposition from the Bush administration, BIO and other industry groups, and letters from Senate constituents, including ones from the Association of American Universities, and a number of trade unions (see links below). However, Mr. Greenwood also acknowledged that patent legislation "puts Members of Congress to sleep" and that made progress in getting a good bill an uphill battle. A result of the polarized opinions and consequences of the damages provisions of the bill on different industries is that voting on the bill would put Senators in the uncomfortable position of favoring one portion of their constituencies over another, which they would rather not do. Another consequence of this disparate impact is that it implicates provisions of the TRIPS agreements that mandate there be no disproportionate treatment of different types of intellectual property, but Mr. Greenwood made it clear that he was not contending that passage of the Senate bill would constitute a TRIPS violation.
Finally, since Mr. Greenwood expects that the various stakeholders will get about a week's notice before the bill comes to the Senate floor, as well as disclosure of any amendments Senators Leahy or Hatch intend to report with the bill, the likelihood of a vote in February is diminishing. In response to a question, Mr. Greenwood said our information was as good as his as to when the bill might come to the Senate floor for a vote.
[NOTE: As reported by the Intellectual Property Owners Association (IPO) this morning, Senator Leahy (at right) told Congressional Quarterly Today that the bill won’t come to a vote until after the two-week March recess that ends March 28th, and that "certain sections" will be subject to redrafting.]
In a companion piece to this article, Donald Zuhn will be discussing Mr. Greenwood's comments on the follow-on biologics legislation.
For additional information on this and other related topics, please see:
• "BIO Report Indicts "Patent Reform" Proponents," February 13, 2008
• "Millennium Pharmaceuticals Spent $1.28 Million on Lobbying in 2007," February 8, 2008
• "Patent Reform and Infringement Damages: Some Economic Reasoning," February 5, 2008
• "Department of Commerce Sends Letter on Patent Reform to Senator Leahy," February 4, 2008
• "Biotech and Pharma Opposition to Senate Patent Reform Bill," February 3, 2008
• "The Letters Keep Coming Over the Senate Transom," January 30, 2008
• "U.S. Senate Mailbox Filling with Letters against Passage of Patent 'Reform' Bill: An Update," January 23, 2008
• "U.S. Senate Mailbox Filling with Letters against Passage of Patent 'Reform' Bill," January 18, 2008
• "Patent Reform Discussed on Senate Floor," December 21, 2007
• "Enjoined New Rules and Patent Reform Finally Appearing on Biotech Industry's Radar," December 20, 2007
• "Chinese IP Judge Discusses Implications of U.S. Patent Reform Bill and Two Congressmen Heed Warning," December 17, 2007
• "IPO President Seeks Deletion of Patent Reform Provision," December 12, 2007
• "Senate May Act on Patent 'Reform' Bill in the New Year," December 2, 2007
• "The Wall Street Journal Gets It Half Right," November 5, 2007
• "BIO CEO Provides Briefing on Follow-On Biologics and Patent Reform," September 18, 2007
• "Patent 'Reform' Bill Passes House of Representatives," September 9, 2007
• "Reversal in Microsoft Case Weakens Patent Reform Argument," August 7, 2007
• "San Francisco Chronicle Opines on Patent Reform," August 6, 2007
• "Patent Reform Bill to Be Delayed?" June 12, 2007
• "Senate Judiciary Committee Holds Hearing on Patent Reform," June 10, 2007
• "Could Creating a U.S. 'Utility Model' Patent Fulfill the 'Need' for Patent Law Reform?" May 21, 2007
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